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The Cybergrocery

Grocery shopping is a necessity of life some of us dread.

But that is not the case with the Feldmans. Their groceries are delivered to their door reports, CBS News Correspondent Randall Pinkston.

"They hand me the groceries and I unpack once, so it's very convenient and it saves me a lot of time," said Debra Feldman.

And, they rarely set foot in a store. No aisles, no long lines. This is not your mother's grocery store. Here, shopping is a keystroke away, on the home computer.

Jeff Feldman said, "You can choose to buy the cheapest can of corn or the cheapest soda if you're not brand sensitive."

Thomas Parkinson, founder of the online grocery said, "The largest growth area in usage right now has been people at work so they are using their lunch hour to actually shop and do a chore that they would normally have to do in their free time."

Online grocery shopping represents a small percentage of supermarket shopping, but traditional grocers are already concerned about their cyberspace competition.

Robert Schwartz of the Gristedes and Sloan's grocery stores said, "Everyone who is selling what I am selling is a competitor."

Cybergrocers predict traditional supermarkets may be forced to log on, "because we are going to cannibalize their sales otherwise," said Peapod's Parkinson.

By 2007, cybergrocers expect to capture $60 billion of the $400 billion now spent each year on groceries, a business where profit margins are penny slim.

"One of the things that drives people to the supermarket is the variety and impulse sales... and that contributes dramatically to today's bottom line," said Schwartz.

Feldman said, "If my wife is there three or four times a week she's doing impulse buying. We're not doing that with this service."

But for all of the convenience, online shopping can't offer the touch and smell of fruits and vegetables. That's why traditional grocers believe most families will continue to do their shopping just like mom did.

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